Wall Street Journal ( gated ) report.
Wall Street Journal ( gated ) report. The U.S. halted dollar shipments to Iraq and paused security support, increasing pressure on Baghdad to curb Iran-backed militias and highlighting Washington’s financial leverage over Iraqi oil revenues.
Summary: U.S. halts dollar shipments to Iraq ~$500M delivery blocked, second since war began Security cooperation and training programs paused Pressure tied to Iran-backed militia attacks U.S. retains leverage via Iraq oil revenue flows Militias hold strong influence in Iraqi politics Move signals escalation of financial pressure The United States has escalated pressure by halting dollar shipments and suspending parts of its security cooperation, signalling a more forceful push for Baghdad to rein in Iranian-aligned militias. U.S. officials recently blocked a shipment of roughly $500 million in cash destined for Iraq’s central bank, marking the second such delay since the outbreak of the Iran war. The funds, derived from Iraq’s oil revenues held at the Federal Reserve Bank of New York, are typically flown into Baghdad to support the country’s cash-based financial system.
The move comes amid a surge in militia activity targeting U.S. interests in Iraq and the region, with Washington linking the delays directly to Baghdad’s failure to curb attacks by Iran-backed groups. In parallel, the U.S. has also paused certain counterterrorism funding and military training programs, increasing the pressure on Iraqi authorities to take concrete action against these militias. The measures underscore Washington’s leverage over Iraq’s financial system.